Thursday, June 16, 2005

Iwan Pontjowinoto and our money

My office normally cut Rp85,000 per month from my salary (which is already low) and send the money to PT Jamsostek. I can’t argue with accounting guys since it is a must, dictated by law. Otherwise, my office could be prosecuted of being against the law. Every six months, normally, I get status report of how much principal and accrued interests or yield, whatever is the name, had accumulated in my account at Jamsostek.

Frankly, I never really take a look at the report. First, the principal amount is just too small even though I’ve been Jamsostek member for more than a decade. Second, my colleges said don’t ever think to get the money easily back.

But when I think of number of co-workers, 400 staffs, that pay the bills to Jamsostek, I started to seriously reconsider my carelessness. My first question was, whether my fellow workers, and so millions of Indonesian workers, get better yields from their investment in Jamsostek.

So I decided to look at the yield column in my account statement. With simple math, I found that yield for 2004 was 8.5%, lot better than interest rates in my bank account.

My curiosity went further with an article published by The Jakarta Post (June 16, 2005) titled Jamsostek to invest more in stocks. The reporter quoted Iwan Pontjowinoto, newly appointed president director of the company. Mr Pontjo said Jamsostek is about to invest at least 15% of its total investment portfolio in stocks this year. How much is the total? Rp40 trillion or equals to US$4.2 billion. It means that Mr Pontjo will invest Rp6 trillion in stocks, increased dramatically from Rp3.44 trillion last year’s.

“Yields from investment in stocks are higher than any other investment portfolio,” he argued.

In the last paragraph, The Post quoted Mr Pontjo saying Jamsostek will invest more on government bonds this year though to help plug the state budget deficit. What? I hope Mr Pontjo as investment manager for all workers in Indonesia reconsider his motive. Jamsostek is not a political venture. By law, Jamsostek should put worker’s interest as an ultimate motive on its investment decision, not to serve political interests like state budget.

Good news is Mr Pontjo promised to give higher yields for my investment at Jamsostek this year onwards. Besides, he also pledged to simplify procedures, including implementation of IT system (he worked for IBM many years) so I could check my account easily.

History is important though. I don’t want to be skeptic on Mr Pontjo. He is an investment banker, former director of PT Danareksa (Persero), the state-owned investment bank. Even though we have to remember that he left the company in 2001 with Rp2.65 trillion debts and productive assets of Rp1.5 trillion only.

In addition to that, Supreme Audit Agency (BPK) found 10 irregularities in Danareksa with potential loss of hundreds billion rupiah. One of BPK’s findings was cross currency swap facility given to PT Jakarta International Hotel and Development (JIHD) which end up with Rp70.8 billion loss for Danareksa.

Unfortunately, none of Danareksa’s board of directors being prosecuted, in contrast with recent investigation on Bank Mandiri loan irregularities.

Now, we have Mr Pontjo at the helm of an important fund management company in the country. Sources at the ministry of state-owned enterprise (SOE) said his appointment was mainly minister Sugiharto’s decision, supported by Aries Mufti (expert staff at SOE ministry). Sugiharto and Muftie were board members of Sharia Economic Society (Masyarakat Ekonomi Syariah, MES) where Mr Pontjo is the chairman.

Well, my friend told me nothing wrong with that as long as he could give better yields for workers who pay regularly and as long as he will not lead Jamsostek to debt-ridden company like Danareksa simply because of misallocation of funds under management. So, watch your investment.

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